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When to use Trusts

As part of your Inheritance Tax Planning, you may want to consider putting assets in trust – either during your lifetime or under the terms of your Will. Putting assets in trust – rather than making a direct gift to a beneficiary – can be a more flexible way of achieving your objectives.


For example:

• You might want assets that will pass to a child to be held on trust until they are older

• You might want assets to eventually pass to your children, but to ensure that your spouse can benefit from them for the rest of his or her life


The tax treatment of trusts is complex and depends on such factors as the kind of trust, the value of the assets put into it, and who the beneficiaries are. Recent changes to the rules mean that the tax treatment of some trusts is no longer as favourable as it used to be, but there are still circumstances in which they can help to reduce the overall level of tax payable.


The structures into which you can transfer your assets can have lasting consequences for you and your family, and it is crucial that you choose the right ones. The right structures can protect assets and give your family lasting benefits. A trust can be used to reduce how much Inheritance Tax your estate will have to pay on your death.

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